QUESTION
If I were to buy a restaurant that has an alcohol-related car accident lawsuit pending, would I be liable or would the previous owner be?
Asked on Jan 10th, 2014 on Criminal Law - Colorado
8 ANSWERS
Criminal Defense Attorney serving Alhambra, CA
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Francis John Cowhig
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It will depend on the sales contract and whether or not you accepted liability for all pending and non-pending legal actions.
Answered on Jan 13th, 2014 at 6:51 PM
Michael J. Breczinski
It depends on how the lawsuit is filed and how the restaurant is organized. Is the lawsuit against the owner personally or against a corporation? Are you buying the corporation(If there is one)? Or are you buying the assets.
Answered on Jan 13th, 2014 at 6:51 PM
Bankruptcy Attorney serving Federal Way, WA
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Freeborn Law Offices P.S.
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Previous owner.
Answered on Jan 13th, 2014 at 6:50 PM
Thomas Edward Gates
You will not personally be liable. Make sure the sale agreement specify that your ownership of the business (assuming name and good will) is free of any litigation related to the previous ownership.
Answered on Jan 13th, 2014 at 6:50 PM
Personal Injury Attorney serving Pasadena, CA
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Law Offices of Pius Joseph
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Discuss with a business lawyer to draft an agreement regarding shifting of liability to the prior owner. Do your due diligence as to the liability exposure prior to your purchase.
Answered on Jan 13th, 2014 at 6:50 PM
James Edward Smith
The previous owner would be but I would get that in writing from the previous owner.
Answered on Jan 13th, 2014 at 6:50 PM
Depends on the contract for sale. The buyer can but does not have to assume responsibility. The seller can only absolve himself from responsibility with a waiver from plaintiff. Is there insurance?
Answered on Jan 13th, 2014 at 6:49 PM
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The purchase agreement should cover that specifically. It is definitely worth the money to hire an attorney for this sale to make sure you do not buy this lawsuit. If the restaurant had insurance, likely they cover it. But, I would not trust anyone but my own attorney on a situation like this.
Answered on Jan 13th, 2014 at 5:30 PM